OFAC Fines Payment Facilitator for Iranian Company
The Office of Foreign Assets Control fined an unnamed person about $133,000 after they violated U.S. sanctions against Iran, OFAC said in a Dec. 8 notice. OFAC said the person accepted payment on behalf of an Iran-based company selling cement clinker to another company for a project in a third country.
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In 2016, the person arranged and received four payments on behalf of the Iranian cement company worth about $133,000. The person “coordinated and further facilitated the sale of the clinker” to the third company along with a family member working at the Iranian company, OFAC said.
The agency said the person had reason to know the payments were illegal because they had previously submitted license applications to OFAC for other transactions, which were denied. OFAC also said the person was told by the Iranian company about “complications” it had faced due to U.S. sanctions, including struggling to receive U.S. dollar payments.
Although the person didn’t receive “significant, if any, financial benefits from” the violations, OFAC said they still violated the Iranian Transactions and Sanctions Regulations by exporting financial services to an Iranian company, helping it sell the clinker and facilitating four transactions. OFAC also said the person’s conduct didn’t fall under a sanctions exemption for personal remittances even though the sale involved a family member. “OFAC found the underlying transactions to be commercial,” the agency said, “and thus unavailable for the authorization.”
The person didn’t voluntarily disclose the violations, which OFAC said constituted an egregious case. Aggravating factors included the fact that the person “willfully violated or recklessly ignored” U.S. sanctions laws and was aware they were committing violations. OFAC also said the person “harmed the objectives” of the Iranian Transactions and Sanctions Regulations by allowing an Iranian company to evade sanctions.
OFAC said mitigating factors included the fact that the person hadn’t received a penalty notice in the previous five years. The agency also said the person “received minimal if any economic benefits from the transactions and presented evidence regarding financial difficulties affecting the person’s ability to pay.”
OFAC said the case highlights the “broad range” of restrictions that apply to Iran, including those “who act as intermediaries between non-U.S. parties.” The agency also said users of sanctions authorizations must make sure their “conduct is consistent” with the scope of general licenses, including those related to remittances and humanitarian aid. As this action illustrates, most non-humanitarian commercial activity falls outside OFAC’s authorizations,” the agency said. “Similarly, it is essential that U.S. persons seeking to transmit personal remittances to or from Iran or other sanctioned jurisdictions ensure there is no intertwined commercial activity.”